International Marketing: Growth of the Internet and Global Marketing

(3750 words)

Introduction

Today, due to the emergence of many companies having the technology and the means for greater expansions of market other existing organizations are forced to innovate and the cope with these changes to continually serve and retain their customers. This is also in response to the expansion of their market internationally. Because global expansion of marketing and business strategies through using technologies needs effective and efficient communication, the use of the World Wide Web becomes one of the most indispensable tools in order to communicate, make transactions, and deal with consumers, employees, and stakeholders of a specific company. Moreover, the use of the World Wide Web has become one of the inevitable ways in obtaining and gathering relevant information regarding a myriad of subject matters and issues. Its use is most popular among the society, most especially the younger generation, who perceive the Internet as one of the most helpful tools in terms of education and communication. Because of this, the growing importance of the Internet has been extended to other aspects, including business and marketing. Most importantly, the use of the Internet has become one of the most important means of sustaining and maintaining businesses, both locally and globally. This is because the use of the Internet ensures direct, fast, and effective communication, from one point of the world to the next. Thus, in this regard, the use of the Internet in all aspects of living in the contemporary society has become one of the most essential means of survival.

As such, this paper would be discussing the role of the growth of the Internet in global marketing. This paper would be emphasizing on the many factors that contribute to the integration of the global market, and the factors that may have hindered the integration of the global market. In this sense, a concrete example of a company that takes on a global business would be analyzed in order to shed light on the importance of the Internet in global marketing.

Background of the Organization

Aside from communication and education, the use of the Internet is being maximized and utilized in terms of business and marketing, such as being done by the eBay company, with their online auction. Through online auctions, individuals are able to obtain and purchase their needed and wanted items directly, without the hassle of traveling and physically looking for their needed products. With the use of eBay, customers are able to purchase their needed products regardless of distance, quantity, weight, and location, through their credit cards and online banking accounts. Thus, the use of eBay promotes convenience and easy access to consumers. This then contributes to the fact that because of the convenience of services and products offered by eBay, it has been regarded as the most successful and largest online auction base. This company would serve to be a good reference to the discussion, as it uses the Internet or the World Wide Web to its advantage, most especially in terms of catering to the needs of its customers, thus, effectively participating and enhancing global marketing and business.

Buyers and sellers of many diverse products are finding eBay to be a viable marketplace. It has been reported that eBay began as a trading post for collectibles, such as Pez dispensers and Beanie Babies, and through the year 2000, those collectibles still accounted for up to 60% of its auctions. In 2003, at least 30 million people bought and sold more than $20 billion in merchandise on eBay, which is more than the gross domestic product of all but 70 of the world’s countries (2005). Thus, with the increase of the sales and transactions, and the continuous patronage of buyers and sellers in eBay, it can be deemed that it really serves to be the largest and most successful online auction.

EBay’s headquarters is located at San Jose, California in the United States of America. The site is managing its online auction, from where people shop, purchase and sell goods and services online, all throughout the world., a computer programmer, founded the eBay site on September 3, 1995 as AuctionWeb, as part of a larger personal site (2007), and since then, the eBay juggernaut has been rolling its way. It is really very astonishing to think that this website was created to sell Pez dispensers and other kinds of collectibles, and would become the leader in the market of e-commerce (2002). In addition, many observers, who have seen eBay grow to the position that it has attained now, commented that there is no force able to stop it from becoming the world’s most successful online auction site. Its business process creates a business model, which does not require the carrying on of any inventory, but rather has its share of the profit margin from every transaction that it does. The operation of the company is done by the means of its market mechanism. With this business process, eBay is able to sell anything and everything that is legal, and which does not violate its policy regarding restricted items. Ten aspects are attributed to the success of eBay, namely, commitment, well-spent funds, an effective and persistent marketing and public relations, great products or services to sell, not selling of junk, great customer service, efficient and pleasant facility, polished listings and photos, paying attention to details, and good recordkeeping (Mansfield 2006). These ten aspects are perceived to be contributory to the success of eBay in the industry as the leading online auction house, and determine its edge over its competitors. The success of eBay has inspired other online companies to engage in the same business, of perceiving the same attention that it receives from consumers. With this, several competitors can be pointed out, which are also online companies that engage in the same services that eBay offers. Aside from Amazon.com, Yahoo! and Netscape (2005), several other online companies have also emerged, including Ubid.com, bid-alot.com, uauction.com, auctionfire.com (2005), and Google (2007). From this, it can be seen that the activities initiated by eBay has become a hit, thus, inspiring other companies to engage in such a business. As such, this means that the increasing number of companies that engage in this particular form of business would contribute to the growth of the Internet as an effective and successful means of global marketing and integration.

Global Marketing through the Internet

From the description of the nature of business of eBay, it can be described as an international business, which provides business perspectives to its buyers and sellers. Thus, it participates in the more general concept of global marketing, which takes place through the Internet. In this regard, because eBay is considered an international business, the concept of international business can also be taken note of. It has been reported that an international business generally is business operations of any sort by one firm, which take place within or between two or more independent countries, and includes the operation of a domestic firm in overseas branches, import and export trade, comparative management and economics systems, functional business analysis, and market entry strategies (1966). To be able to do this, nations involved must be able to come up with effective market entry strategies and penetrate the market of another nation. In building a market entry strategy, time is a crucial factor, for building of an intelligence system and creating an image through promotion takes time, effort, and money. However, through using the Internet of the World Wide Web, it would be easier for eBay to enter markets and nations, due to its accessibility and convenience. With just one click, it would be easy and accessible to everybody to purchase and sell their products through eBay, thus, producing easy money and profit. In this regard, it would be easier for the company to participate in global marketing, which involves recognizing that markets around the world consist of similarities and differences. Based on such similarities, it would be possible to develop a global strategy to obtain scale economies. On the other hand, based on differences, the cost in producing a global strategy must also be recognized and responded to. Through the development of such strategies, the combination of the processes of extension, adaptation, and creation would be emphasized, which would also provide recognition that such strategies must respond and become alert to the unpredictable behavior of consumers and available opportunities in the market ( 1998). In this sense, because such strategies are being exhibited by eBay, then it can be perceived that it has been actively participating in global marketing. Although many other companies participate in this sense, the edge of eBay comes from its use of the Internet, which serves to catalyze the whole process of global and international marketing.

The business transactions and promotions made by eBay and other online auction companies gives credit to the fact that this modern society is entering a new era of global marketing. The new era of global marketing presents that consumers can visit Internet websites and procure goods from around the world without actually having to visit the shops of the countries themselves. Thus, from this, it can be perceived that the increasing trend for consumers to use the Internet leads to the development of the new trend of global marketing, which is making transactions, communicating with one another, obtaining relevant and appropriate information, updating systems and processes, and participating in globalization and internationalization through the World Wide Web.

As emphasized previously, it has been stressed that the Internet is one of the most significant marketing tools for the global marketplace. Estimates from various electronic commerce or e-commerce surveys indicate that Internet users worldwide will more than double from approximately 318 million in 2000 to about 717 million in 2005 (2003). In this regard, because it serves to be an indispensable and significant market tool for the global marketplace, it can be perceived that the use of the Internet would provide efficacy, efficiency, and success in terms of business and marketing transactions and projects. Thus, in terms of global marketing, the use of the Internet serves to be one of its important milestones in this modern society.

Impacts of the Use of the Internet in Global Marketing

It has been reported that the market today is not anymore a central market located in one city or place, but it is a virtual market that consists of a myriad of entrepreneurs, risk takers, and savers around the globe (2002). This just means that the business transactions and negotiations in one part of the world may not be exclusive on that place, but may also be transcended in other parts of the world. Thus, in this regard, the world becomes in itself a big marketplace, wherein the business transactions of one individual or one business would matter to other businesses or to the overall business transactions in the world. From this, it can be deemed that this process is similar to the process of globalization, wherein it means the opening and cross relating of different economies in the world, in line with the desire to have a wider and diverse market. This serves to be the primary impact of the use of the Internet in terms of global marketing. Through the online auction businesses, such as eBay, the process of globalization is being emphasized. Globalization, as one of the impacts of the use of the Internet has been used in a diversity of senses. Such are the concepts of global interdependence of nations, the growth of a world system, accumulation on a world-scale, the global village and many others are rooted in the more general notion that the accumulation of capital, trade, and investment is no longer confined to the nation-state. In its most general sense, globalization refers to the cross-national flows of goods, investment, production and technology (1999). In relation to this, through the process of globalization, it can be seen that today’s generation has entered the new era of global marketing, as with globalization, more international businesses and corporations are able to introduce their products and services to other parts of the world and to other markets. In this sense, the strategies of eBay have become part of the process of globalization, which has been enhanced through the World Wide Web. Thus, in this regard, it can be perceived that the different global marketing strategies being used by large corporations and companies have also changed. Strategies have improved in the sense that large companies collaborate with large Internet and Web-based companies in order to fully reach their markets. Aside from using conventional marketing techniques, many organizations invest in the Internet and other Web-based services to gain more profit.

Another major impact that the use of the Internet has brought about to global marketing is that the use of the Internet is boundless. This just means that possibilities are endless using the Internet, thus, making the companies cope with the fast-paced changes that can be observed in the society. The impact of business-to-business marketing would enable marketers to shift their promotional dollars from traditional media to Internet-related advertising and marketing activities (2002). In addition, convergence of the different types of media and advertising has now been observed, enhancing one form of media, from simple to a more extravagant one. This emphasizes that fact that as the information available through the Internet exceeds all previously known bounds, the world seems to be getting smaller. Information is instantaneously transmitted, and the reaction times of global leaders have had to improve to keep pace (2002). The third impact of the use of the Internet to global marketing is that the use of the Internet makes global marketing plausible. The Internet has already become the first truly cost-effective, widespread global marketing medium, for with its roots and technology in worldwide networking, any marketer theoretically could reach any online customer anywhere in the world at any time. Information is transmitted via email or over the Web and received instantly, without regard to time zones or geographic location, and no technical skills are necessary to receive it (2002). This just means that the use of the Internet becomes a relevant and appropriate means to an end, and this end seems to be effective global marketing strategies that further enhances and catalyzes the process of globalization and internationalization. In relation to eBay, it can be deemed that because the company entirely utilizes and maximizes the use of the Internet, eBay has been regarded to be contributory to the development of global marketing. This is because in order for a consumer to become encouraged to purchase or sell products in eBay, the company must therefore sell itself using effective online advertisements. Because this is seen by other companies to be effective, using the Internet as one of their strategies has now been integrated in global marketing.

The next impact of the use of the Internet is that it reaches people with intellect, power, and money. This is because most of the users of the Internet are elite, educated, influential, and upscale, thus, in the case of businesses, such people often means key decision makers (2002). Influential people have a lot to do with businesses, as most of serve to be stock or shareholders of different large corporations. They also use their connections in order to reach other businessmen to be used for their advantage. In this sense, it can be perceived that through the Internet, communication with the influential and educated people would be effectively done, and this means that establishing connections with them would somehow be useful in the future, most especially in terms of advertising and marketing. Aside from them, the regular and common consumers, who are also educated and influential in their own right, also matter. Because they belong to the majority of the market, their needs, demands, and opinions would dictate the success of a particular product in the market.

The last and most important impact of the use of the Internet in global marketing is related to the previous impact, and emphasizes that the Internet offers increased business penetration. As a business tool, the Internet is unprecedented in its penetration of the business community, as its roots are implanted in science and business, and business-to-business usage has continued to lead its growth ( 2002). In this sense, it serves to be an indispensable tool in business based on its capabilities to execute both marketing and communication functions better than more traditional media and marketing systems. It has been pointed out that the Internet allows a business to access global markets, provide mass customization, reduce marketing costs, build strong business relationships with a greater degree of channel coordination, develop business intelligence, offer heightened communication with various publics to improve corporate image, and improve customer communication and service (2002). With such advantages, it can be recognized that the use of the Internet would both enhance and develop global marketing. Given such functions, it would be easier for companies and large corporations to engage and sustain their businesses.

Analysis on the concept of “New Era of Global Marketing”

It has been emphasized that many small and large businesses are already using the Internet for promoting products, customer service, and for business transactions ( 1998). One of such businesses includes the eBay company, which is said to be regarded as the largest and most successful online auction company. In relation to this, it has also been emphasized from the previous discussion that our market now is termed as the global market, wherein ideas, concepts, businesses, and gain flow freely from one part of the world to the next. Thus, global marketing strategies, including the use of the Internet is being effectively utilized in order to cope up with the fast-paced changes that are continuously happening and developing in the society.

In my personal opinion, I believe that we already have entered the new era of global marketing ever since the use of computers and the Internet have entered the scene. This because through the Internet and the computers, marketers and business enthusiasts have invested their time, effort, money, creativity, and skills in order to make substantial and unique works of art for the purpose of advertising. Ever since the use of the Internet has been introduced, more computer-related jobs and fields have been developing. This just means that due to the influence and the perceived advantages of the Internet, the use of conventional strategies in global marketing has already been phased out. However, because conventional ways of global marketing can still be used, many business enthusiasts and researchers have come up with alternative use conventional strategies in global marketing by embedding Internet-related programs. Another proof that we have already entered a new era on global marketing can be observed in the firms per se. This is because both small and large organizations have already been focusing on innovation, knowledge, and capabilities as central themes of research on its strategy and performance (2004). This is because the use of the Internet has opened the awareness of many business organizations regarding the many advancements in science, communication, and technology that they can use in their aim to develop and improve their businesses. The changes in the knowledge and skills of many individuals in business organization have helped develop new and improved perceptions in doing business both inside and outside the country. This can be seen with the founding of the eBay company, as the owner can be perceived to have thought ahead, giving emphasis on the future use and dependence on the Internet for various transactions and negotiations. The last proof that we have already entered a new era of global marketing is the fact that new forms of customers have already emerged in the market scene. In the large, developed markets, consumers are more demanding, and this can be seen in various fields, such as clarity of offer, quality of service, and availability of sales personnel and assistance. Consumers receive and respond to advertising and direct marketing solicitations that arrive through an increasing variety of channels of communication, namely through publicity, telemarketing, and the Internet (2004). The emergence of such types of consumers means that business organizations must be efficient and effective enough to meet their increasing and ever changing needs. Today’s generation has produced consumers that know what they want, thus, are assertive and demanding about their needs and rights. As such, it can be perceived that the use of the Internet serves to both a means and an end to the changing needs and wants of consumers. Such has been perceived by eBay, thus, becoming the most successful online auction in the business.

Conclusion

From this, it can be seen that the world has now become more integrated and interdependent, as the use of the Internet makes an individual on the other side of the planet communicate simultaneously with other individuals on the other side. As previously mentioned, the many impacts and advantages of using the Internet has benefited the larger concept of global marketing, thus, emphasizing the fact that in today’s generation, the activities of one business organization matters to others and to the whole society as well. However, despite the fact that overall integration and interdependence of business organizations, economic, social, and political activities, and individuals at large can already be observed, a number of hindrances can still be recognized. Hindrances to the absolute integration and interdependence of markets to form a distinct single market includes poverty, lack of acceptance, lack of knowledge and skills, social classification and stratification, lack of funds, economic and political inequalities, and discrimination. Such factors serve to hinder the integration of markets to form a single market because they limit the skills and knowledge of individuals in terms of the use of Internet in global marketing. Such has been experienced in developing countries, as they suffer from the lack of expertise and knowledge in most aspects of development, compared to developed countries. Thus, in this sense, it can be seen that the use of the Internet in order to enhance the many facets of global marketing serves to dictate a status quo, which separates a Third World country from a more developed one. As such, it can be concluded that the use of Internet in terms of promoting the improvement and development of global marketing serves to be a double-edged sword. With this, the decision of utilizing it must be thought of intelligently and carefully in order to enjoy its benefits.